Archive for March, 2009
Tuesday, March 31st, 2009
There are two (2) questions I am asked at least a few times each day when people contact me for bankruptcy advice: Does it affect my spouse or partner? Can I keep my car?
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Tuesday, March 31st, 2009
The first and the most basic question is ‘under which chapter of the law should I file for insolvency?’ Well, as a matter of fact, you should file for insolvency under chapters 7, 9, 11, 12 and 13 of the bankruptcy law. …
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Tuesday, March 31st, 2009
Chintamani asked: ·
InsolvencyCash flow insolvency is the inability to pay debts upon demand. Balance sheet insolvency simply means that you have more debts than assets. It is possible to be cash flow insolvent at the same time you are balance sheet solvent. This happens when you have money bound up in non-liquid assets. Many taxpayers have experienced this recently, when they have been forced into foreclosure due to the inability to pay their mortgage.
When your liabilities exceed your assets, you are insolvent. If a lender forgives your debt under insolvency, you can file for insolvency exclusion in that amount on your income tax. Otherwise you will have to enter the forgiven debt on your income tax report. Recently many homeowners realized that the cost of their mortgage exceeded the value of their home. These homeowners qualified for the insolvency exclusion on their taxes.
The amount you can exclude can be no higher than the amount by which your liabilities exceed your assets. If the debt forgiven qualifies under the tax code and is used for running a farm, it might not be income at all.
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Chapter twelve or thirteen bankruptcyIf you file a chapter twelve or thirteen bankruptcy, you will file the same income tax report. Include your entire income, as is normal procedure. But do not include any cancelled debt on your federal income tax return. Losses in property must be reduced by the total cancelled debt.
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Chapter seven or eleven bankruptcyUnder chapter seven or eleven bankruptcy filings, a separate estate is created from your estate prior to filing. You, as a taxpayer and your bankruptcy estate are two distinct entities. Under chapter seven, a trustee is appointed to your estate. The trustee sees to the liquidation of your non-exempt assets. Under chapter eleven, you stay in charge of the estate. You are given debtor-in-possession status. All monies earned after the bankruptcy filing are yours and not part of the bankruptcy requirements. If your bankruptcy petition is rejected, you are responsible for filing an Internal Revenue Service tax form 1040X and become responsible for your income taxes as if you had never made the bankruptcy petition.
You have to file an income tax return during the bankruptcy process. You will not include, deductions, credits, or income belonging to the bankruptcy estate, as it is an entity separate from you. You can choose to end your tax year the day before you file your bankruptcy petition.
If you file for bankruptcy after the first of January, any refund you receive from taxes that year, even if you have yet to file, is an asset in your bankruptcy.
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Tuesday, March 31st, 2009
Your Baltimore bankruptcy lawyer can help point you in the right direction after these preliminary questions have been answered. While it is important to listen to the advice and recommendations of your bankruptcy lawyer, remember that …
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Tuesday, March 31st, 2009
As more and more Americans fall victim to rising bills and a slowing economy, a good number of ordinary citizens have been forced to investigate bankruptcy as a final solution to mounting debtloads. Nearly two million of us went …
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Tuesday, March 31st, 2009
I spoke with a trustee today about my spouse filing bankruptcy. I was under the impression that when figuring out the equity value in our home that you subtract the real estate fee`s, lawyer fee`s, and interest penalties. The trustee told me that if I am planning on keeping the home that you cant subtract those fee`s. Is this true?
Posted from: Ontario
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Tuesday, March 31st, 2009
I spoke with a trustee today about my spouse filing bankruptcy. I was under the impression that when figuring out the equity value in our home that you subtract the real estate fee`s, lawyer fee`s, and interest penalties. The trustee told me that if I am planning on keeping the home that you cant subtract those fee`s. Is this true? Posted from: Ontario. Filed under: Bankruptcy. posted by Questions @ 8:27 pm. 1 Expert Comment: Click here for more information about Ted …
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Tuesday, March 31st, 2009
It is necessary for you to comprehend the assorted events that comprise the different bankruptcy chapters. The more familiar chapters frequently utilized are chapter 7 bankruptcy law, 9, 11, 12 and 13. The terms all refer to the various methods of bankruptcy, however now we will pay particular attention to chapter 7 bankruptcy law.
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Tuesday, March 31st, 2009
This posting begins by listing excerpts from the “Frequently Asked Questions” that Magna Entertainment has posted about its bankruptcy filing (the complete list of questions and answers can be found at …
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Tuesday, March 31st, 2009
If you are looking to file bankruptcy in the state of Massachusetts, there are different types of bankruptcy to consider. Exemptions are allowed in Chapter 7 and 13 bankruptcies. These exemptions are defined by the state in which you are filing and disallow your applicable property from being sold to pay your debts. Some of the more important exemptions as defined by the state of Massachusetts are as follows:
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